EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0934376
Customs Act 1901
Background
Part XVA of the Customs Act 1901 (the Act) sets out a scheme under which Tariff Concession Orders (TCOs) may be made by the Chief Executive Officer of Customs (the CEO). A lower rate of customs duty applies to goods that are the subject of a TCO.
Under section 269F of the Act, a person may apply to the CEO for a TCO in respect of goods. If the CEO is satisfied that the application is not in respect of goods specified in section 269SJ of the Act, which sets out those goods that cannot be subject to a TCO, the CEO must decide whether the application meets the core criteria.
Section 269C of the Act provides that a TCO application meets the core criteria if, on the day on which the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269B of the Act provides that ‘goods produced in Australia’ has the meaning given by section 269D, ‘ordinary course of business’ has the meaning given by section 269E and ‘substitutable goods’ in respect of goods the subject of a TCO application, means goods produced in Australia that are put, or are capable of being put, to a use that corresponds with a use (including a design use) to which the goods the subject of the application can be put.
Subsection 269P(3) of the Act provides that if the CEO is satisfied that a TCO application meets the core criteria, the CEO must make a written order (a TCO) declaring that the goods the subject of the TCO application are goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (the Tariff) specified in the order applies.
Gilbarco Australia applied for a TCO in respect of certain liquid fuel nozzles on 15 September 2009.
Instrument
TCO No 0934376 was made on 27 November 2009. It declares that those certain liquid fuel nozzles are goods to which item 50 of Schedule 4 to the Tariff applies since the CEO was satisfied that no substitutable goods were produced in Australia. The general rate of duty on these goods is 5%. The rate of duty for the goods subject to the TCO is free.
Consultation
Subsection 269K(1) of the Act provides in part that as soon as practicable after accepting a TCO application as a valid application, the CEO must publish a notice in the Gazette which includes an invitation to any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO. The CEO did not receive any submissions in response to this invitation.
Commencement
Subsection 269S(1) relevantly provides that a TCO is to be taken to have come into force on the day on which the application for the TCO was lodged. TCO No. 0934376 is taken to have come into force on 15 September 2009.
The TCO does not affect the rights of a person (other than the Commonwealth) as at the date of registration so as to disadvantage that person or impose liabilities on a person (other than the Commonwealth) in respect of anything done or omitted to be done before the date of registration. The rights of importers will be beneficially affected. Under paragraph 126(1)(r) of the Regulations, importers of such goods will be able to apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force. The TCO does not impose any liabilities on any person.
Overview
The Customs Act 1901, enacted by the Parliament of Australia, facilitates the application of tariff concessions on certain goods to promote trade and economic growth. This legislation allows for the creation of Tariff Concession Orders (TCOs) that can reduce customs duties on specific goods, provided they meet certain criteria. Specifically, the Act allows the Chief Executive Officer of Customs to issue TCOs if no substitutable goods are produced in Australia. This mechanism was introduced to address the need for tariff reductions on imported goods that do not have domestic alternatives, thus supporting businesses and consumers by lowering the cost of these goods. The explanatory statement outlines the process for the creation of TCO No. 0934376, which grants tariff concessions on certain liquid fuel nozzles, reducing their duty from 5% to free, thereby benefiting importers and potentially the broader market.
Scope and Application
The Tariff Concession Instrument No. 0934376 pertains to the Customs Act 1901, specifically under Part XVA which outlines the procedure for the issuance of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). This instrument applies to goods for which a TCO has been applied and approved by the CEO, resulting in a concession on the usual customs duty. The application of this instrument extends to any entity or individual involved in the import of the specified goods, provided the application meets the core criteria set out in the Act, particularly the condition that no substitutable goods were produced in Australia on the day the application was lodged. The instrument has a national reach, applying across the Commonwealth of Australia. It excludes certain goods specified in section 269SJ of the Act and any transactions conducted before the instrument's effective date, ensuring that the rights of importers are positively affected while safeguarding against any retroactive disadvantage or liability. The CEO's decision to grant a TCO is subject to public consultation, although in this case, no submissions were received. The instrument is effective from the date the application was lodged, which was 15 September 2009.
Key Provisions
The Tariff Concession Order (TCO) No. 0934376 under the Customs Act 1901 (section 269F) provides specific provisions regarding the tariff concessions on certain liquid fuel nozzles. Pursuant to this TCO, these goods are subject to a rate of customs duty that is free, as opposed to the general rate of 5% (section 269P(3)). This order was made by the Chief Executive Officer of Customs (CEO) on 27 November 2009, and it is effective from 15 September 2009, the date the application was lodged (subsection 269S(1)).
The Act imposes several obligations and requirements on the parties involved. Firstly, any person who wishes to apply for a TCO must ensure their application complies with the core criteria set out in the Act (section 269C). The CEO must assess whether the application meets these criteria, particularly whether no substitutable goods are being produced in Australia at the time of application (section 269D, 269E, and 269F). Additionally, the CEO is required to publish a notice in the Gazette inviting any interested parties to lodge submissions if they believe the TCO should not be made (subsection 269K(1)). The CEO must also decide on the application in a timely manner if the core criteria are met. In this case, the CEO received no submissions opposing the TCO.
Under the Customs Act 1901, there are potential consequences for non-compliance with the provisions of a TCO. However, the explanatory statement does not specify any particular offences, penalties, or civil/criminal consequences directly related to the TCO No. 0934376. Generally, any breaches of the Customs Act could result in penalties such as fines or imprisonment, depending on the severity of the breach. The maximum penalties for breaches of the Customs Act are set out in other sections of the Act and may vary based on the specific circumstances of the case. Importers and other affected parties should ensure compliance with the TCO to avoid any potential legal repercussions.